CZK: Koruna Slips Ahead Of Thursday's CPI Report
EUR/CZK has inched higher this morning, staying within the confines of yesterday's range in the process. The rate last deals +0.037 at 25.353 and bulls need a clearance of Aug 1 high of 25.535 to regain poise. Bears look for a pullback below the 50-DMA, which kicks in at 25.162 and capped price action towards the end of the month before eventually giving way.
- The CZSO will release September CPI data tomorrow morning (08:00BST/09:00CEST), with the CNB due to release its comments on the latest print later in the day (12:00BST/13:00CEST).
- The ruling coalition is expected to back Milos Vystrcil's (ODS) bid to be re-elected as Senate Speaker, which virtually guarantees him success.
- CZGB yields are broadly lower a typing. The Finance Ministry will auction 2027 and 2035 bonds today.
- The PX Index comes under pressure, sits 0.4% below neutral levels.
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ISSUANCE: China to launch first EUR-denominated bond since November 2021
- The Chinese MOF has announced that it will launch a EUR sovereign bond in the W/C 23 September with a size to not exceed E2bln.
- This will be the first Chinese international bond since November 2021 when it launched a triple-tranche 3/7/12-year issue for a combined E4bln (E1.5bln / E1.5bln / E1.0bln respectively).
- As the 3-year issue is due to mature in November of this year, there is a possibility that some of those funds could potentially be rolled into the new issues (given the lack of foreign currency issuance over the past few years its hard to say with certainty either way).
- The new issue will be listed in Paris.
COMMODITIES: Last Week's Sell-Off Reinforces Bear Theme in WTI Futures
WTI futures maintain a softer tone and last week’s impulsive sell-off reinforces the bear theme. The move lower resulted in a breach of key support at $70.88, the Aug 5 low. The clear break of this level confirms a resumption of the downtrend that started Apr 12 and opens $66.66, a Fibonacci projection. MA studies are in a bear-mode position highlighting a clear downtrend. Initial firm resistance is at $73.09, the 20-day EMA. The trend condition in Gold is unchanged and the primary direction remains up. Moving average studies are in a bull-mode set-up and this continues to highlight a dominant uptrend. Furthermore, a bullish price sequence of higher highs and higher lows remains intact. Sights are on $2536.4 next, a Fibonacci projection. The 20-day EMA has recently been pierced. The next firm support to watch is $2446.0, the 50-day EMA. S/T weakness is considered corrective.
- WTI Crude up $0.93 or +1.37% at $68.63
- Natural Gas down $0.08 or -3.56% at $2.194
- Gold spot down $4.78 or -0.19% at $2491.64
- Copper up $6.9 or +1.69% at $414.4
- Silver up $0.15 or +0.54% at $28.068
- Platinum up $12.48 or +1.35% at $937.51
EQUITIES: E-Mini S&P Remains in Bear-Mode with Scope Seen for Deeper Retracement
Eurostoxx 50 futures reversed course last week and a bearish tone - a correction - remains intact for now. The move down has resulted in a break of both the 20- and 50-day EMAs. Friday’s sharp sell-off signals scope for an extension lower and sights are on 4686.53, a Fibonacci retracement point. Initial key short-term resistance has been defined at 4998.00, the Sep 3 high. First resistance is at 4880.84, the 50-day EMA. Last week’s move lower in S&P E-Minis highlighted the start of a corrective cycle. The contract remains in a bear-mode condition for now and scope is seen for a deeper retracement near-term. An extension lower would open 5330.00, 61.8% retracement of the Aug 5 - Sep 3 bull leg. Key resistance has been defined at 5669.75, the Sep 3 high. Initial firm resistance to watch is 5544.68, the 20-day EMA.
- Japan's NIKKEI closed lower by 175.72 pts or -0.48% at 36215.75 and the TOPIX ended 17.69 pts lower or -0.68% at 2579.73.
- Elsewhere, in China the SHANGHAI closed lower by 29.319 pts or -1.06% at 2736.488 and the HANG SENG ended 247.34 pts lower or -1.42% at 17196.96.
- Across Europe, Germany's DAX trades higher by 90.02 pts or +0.49% at 18392.07, FTSE 100 higher by 40.5 pts or +0.5% at 8221.98, CAC 40 up 31.52 pts or +0.43% at 7383.82 and Euro Stoxx 50 up 30.74 pts or +0.65% at 4768.8.
- Dow Jones mini up 175 pts or +0.43% at 40582, S&P 500 mini up 30.5 pts or +0.56% at 5449.5, NASDAQ mini up 142 pts or +0.77% at 18598.75.
